Correlation Between Rajthanee Hospital and Supalai Public

Can any of the company-specific risk be diversified away by investing in both Rajthanee Hospital and Supalai Public at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Rajthanee Hospital and Supalai Public into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Rajthanee Hospital Public and Supalai Public, you can compare the effects of market volatilities on Rajthanee Hospital and Supalai Public and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Rajthanee Hospital with a short position of Supalai Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rajthanee Hospital and Supalai Public.

Diversification Opportunities for Rajthanee Hospital and Supalai Public

0.27

Correlation Coefficient

Rajthanee Hospital  Supalai Public

Modest diversification

The 3 months correlation between Rajthanee and Supalai is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Rajthanee Hospital Public and Supalai Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Supalai Public and Rajthanee Hospital is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Rajthanee Hospital Public are associated (or correlated) with Supalai Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Supalai Public has no effect on the direction of Rajthanee Hospital i.e., Rajthanee Hospital and Supalai Public go up and down completely randomly.

Pair Corralation between Rajthanee Hospital and Supalai Public

Assuming the 90 days trading horizon Rajthanee Hospital Public is expected to under-perform the Supalai Public. But the stock apears to be less risky and, when comparing its historical volatility, Rajthanee Hospital Public is 62.4 times less risky than Supalai Public. The stock trades about -0.05 of its potential returns per unit of risk. The Supalai Public is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  2,119  in Supalai Public on September 29, 2024 and sell it today you would lose (289.00) from holding Supalai Public or give up 13.64% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Rajthanee Hospital Public  vs.  Supalai Public

Rajthanee Hospital Public

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Rajthanee Hospital Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's technical indicators remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Supalai Public

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Supalai Public are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Even with relatively conflicting essential indicators, Supalai Public reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Rajthanee Hospital and Supalai Public

The main advantage of trading using opposite Rajthanee Hospital and Supalai Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rajthanee Hospital position performs unexpectedly, Supalai Public can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Supalai Public will offset losses from the drop in Supalai Public's long position.

The idea behind Rajthanee Hospital Public and Supalai Public pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Global Correlations module to find global opportunities by holding instruments from different markets.